Knoxville Tennessee Real Estate Blog

2012 Real Estate Trends: Comparing Knoxville to the rest of Tennessee

By guest author Emma Crawford

With 2012 getting in full swing this February, a number of real estate markets around Tennessee are analyzing their original goals to see where they are stacking up. A number of cities such as Memphis and Nashville are looking to seek improvements in the market in 2012. With one month underway, a look at the Knoxville real estate market’s place in comparison to the rest of the state and nearby cities is a great way to measure early success.

For the entire state of Tennessee, median prices are sitting at $129,000 right now. Knoxville’s average listing price of $240,000 in February is certainly superior to the statewide average, which is a great positive for area sellers. In comparison, Memphis’s current median prices are sitting at $145,000. When it comes to median prices, Knoxville is certainly holding an advantage over other the rest of Tennessee right now.

Mortgage rates are certainly an important part of real estate these days. As they’ve hit record lows in 2011, buyers have been able to take advantage of rates lower than a lot of rent prices. Compared to the state’s two biggest cities, Memphis and Nashville, Knoxville is currently home to the lowest 30 year fixed rate mortgages of the three. Knoxville’s current APR of 3.88 is highly comparable to Memphis and Nashville, which are both sitting at 3.977 APR

Just as mortgage rates have gone down, apartment rental rates continue to go up throughout the country. While this is one area where Knoxville is similar to the state’s other big cities, the trends could be positive for area sellers. Knoxville’s rentals are up almost four percent over the past three months, while Nashville apartments have gone up nearly eight percent in the same time frame. With apartment rentals going up all over the state, it’s possible that those who are on the fence between renting and buying could decide to pull the trigger on the purchase of a home in 2012.

Right now, Knoxville has comparable inventory to Nashville near 3050, although it’s short of Memphis, who has 3095 homes on the market. However, even though Memphis has a better inventory right now, homes are staying on the market for a lot shorter time in the Knoxville area. Right now, the average Memphis-area home is on the market for 121 days, compared to just 100 on average for a home in the Knoxville area.

Certainly there are some gives and takes when it comes to Knoxville’s current status compared to other large real estate markets in Tennessee. One huge positive is the clear advantage in listing price that Knoxville currently holds, which will be a boon for area sellers. Hopefully the record low mortgage rates in the state, combined with rising rental rates can help continue to drive a strong 2012 in the Tennessee real estate markets.

Visit KnoxvilleHomeCenter.com for all your Knoxville area and east Tennessee real estate needs.

How to Choose Your New Neighborhood

A guest post by James Kim.

Moving is a strenuous task. Not only do you have to deal with the extremely stressful transition into a new life in a new place, but you have to pack your old life into boxes and coordinate a move. Even more stressful, though, is the process of choosing a new house. One of the biggest components to buying the perfect house is choosing the right neighborhood for you — a task that can become complicated and frustrating if, say, you are perusing Austin real estate but know nothing about the city and its layout. No need to worry. There are several tips to keep in mind that can make your task that much easier.

Familial Situation

A huge component to deciding on an area is whether or not you have children. If you do, you want to look for an area that is near to a school. Try visiting a website like Great Schools to examine schools, their locations and ranking. You may also want to look at real estate property near a park, playground, and local pool to make family activities more accessible. Clearly, if you do not have offspring, you will probably want to steer clear of school zones. However, living in suburbia could have its perks — moving into a location near a school can help you sell your house later on down the road.

Commute

No one wants to wait hours in bumper-to-bumper traffic every morning to get to work. When investigating different neighborhoods, always snoop around during rush hour traffic in addition to normal business hours to really get a feel for the traffic you will be up against.  Being close to public transportation can alleviate this problem, so also investigate other means of getting to and from work.

You may also want to see what “amenities” are near your neighborhood of choice. How far is the grocery store? Post office? Mall? Downtown area? Gym? While that quaint house tucked in the quietest part of town may be charming, it may be more isolated than pragmatic.

Safety

Most importantly, you will want to consider safety. You can check out the crime rates in your prospective area by visiting sites like Family Watchdog. Ask the neighborhood police force or even local business owners if the area is safe. Will you be able to walk home or take a jog around the area at night? You can’t create a home if you don’t trust your neighbors or your area.

Ambiance

Research only goes so far. After researching on the internet, visit the area under consideration. Take a walk around the block, visit the local coffee shop, mingle with the locals, and get a “feel” for the place. To cover all your bases, visit the neighborhoods at all times of day in different circumstances. Chat with a realtor who specializes in the area and ask them how the neighborhood is at night.

While finding a new place and moving can be extremely stressful, you can minimize your headache by keeping these tips in mind. Your efforts will pay off in a home that could last you a lifetime.

James Kim writes for Austin Real Estate service Homecity.com. HomeCity combines powerful online Austin MLS search technology and other online tools with personalized real estate services to provide clients with the knowledge they need to make the right buying and selling decisions.

Following are the most recent batch of spam, trogan, and virus alerts sent to my email filter. Be on the lookout for them and don’t fall for any of their schemes.

Your best protection is to keep your computer updated and keep your antivirus program running at all times.

Please keep in mind that all the links below lead not to the virus itself but to the www.OnlyMyeMail.com alert.

I thought the eBay alert one was especially clever but a fraud attempt nonetheless.

Be careful out there and always practice safe computing.

Virus and Fraud Email Security Updates

Below are the fraud, trojan and virus alerts that were posted to the OnlyMyEmail Spam Blog during the last month.  Emails reported are chosen due to inbound volume and/or the frequency that end users are resending these emails to themselves, indicating they may mistakenly believe them to be legitimate.

Apple Store Order Notification Spam
http://blog.onlymyemail.com/apple-store-order-notification-spam/

Wells Fargo Online Fraud Prevention ? Spam ? Fraud
http://blog.onlymyemail.com/wells-fargo-online-fraud-prevention-spam-fraud/

Critical security patch released! ? Spammed Virus
http://blog.onlymyemail.com/critical-security-patch-released-spammed-virus/

OnlyMyEmail Receives Highest Score Ever in the Virus Bulletin Spam Challenge
http://blog.onlymyemail.com/onlymyemail-receives-highest-score-ever-in-the-virus-bulletin-spam-challenge/

Action Required : Download New Acrobat PDF Reader For Your Windows – Spam
http://blog.onlymyemail.com/action-required-download-new-acrobat-pdf-reader-for-your-windows-spam/

Message from eBay Member Regarding Item # ? Spam/Fraud
http://blog.onlymyemail.com/message-from-ebay-member-regarding-item-spamfraud/

Your account has been locked ? TCF Spam
http://blog.onlymyemail.com/your-account-has-been-locked-tcf-spam/

There are many additional posts on a wide variety of email topics.

Feel free to pass these links along to others that may benefit from these security warnings.

Don’t put your Knoxville home on the market before watching these 5 tips to prepare your home for sale. Visit my Knoxville website to get more great selling tips and suggestions based on more than 30 years of experience selling homes just like yours.

Here’s my “90 second lightning round” of home selling tips for the very busy. 😉

Here’s 40 more free or low cost tips for you that will likely make your Knoxville area home sell faster and for more money.

Outdoors

1. Be sure your lawn and shrubbery is kept trimmed at all times. Consider
removing overgrown trees and shrubs that  hide the house from the street.

2. Keep the garage doors down at all times.

3. For a touch of color, have seasonal flowers growing in beds and containers.

4. Make sure your driveway is in good repair. Pressure wash concrete drives
and walks to remove stains and car drippings, and put a fresh coat of
sealer on asphalt drives.

5. Make sure patios and decks are clean and in good repair.  Replace any
rotten wood and nail down loose boards on decking or steps; pressure wash
if needed.

6. Garage sale time! Clear out everything you don’t intend to keep and tidy
up what’s staying.  Make sure garage doors and openers are in proper
working order.

7.Check all railings and fencing to make sure it’s in good repair and
freshly painted.

8. Pay special attention to the area around your front door; make sure your
doorbell works, clean all cobwebs, leaves, and other debris that may have
accumulated there. Give the front door a fresh coat of paint if needed;
paint is one of the most cost effective fix up items you can do.

9. Check for broken windows or leaking seals on thermo pane windows;
replace if necessary.

10. Clean all the cobwebs from around the front door.  Make sure all
outdoor lighting (especially front porch) is clean and shiny; replace if
necessary. It is especially important that the entrance to your home make a
good first impression on prospective buyers.  This sets the tone for the
whole showing.

11. Check your mailbox. Is it straight and upright? Neatly trimmed around?

12. Before you start indoors walk across the street in front of your house
and look back (like a buyer will see it).  Does it present an appealing
appearance?

Indoors

13. Start by walking through the house and making a list. Do your carpets
need shampooing? Floors need a fresh coat of wax? Dust all ceiling fans
especially the blades and wash light
fixtures.
14. You’re going to have to pack when you move anyway, so go through all
your closets and pack up everything you don’t need for the next couple of
months. A closet with only a few neatly arranged items creates an
impression of abundant storage space.

15. Thin out overcrowded rooms. Ever notice the model homes sparse
furnishings?  They make the rooms look larger. Consider renting a storage
facility to store excess lamps, tables, and large items that eat up space
in a room.

16.Go through and pack up most of your family pictures and collections of
model ships, stamps, quilts, or anything that might cause a buyer to stop
and look at your collections of stuff instead of your house.

17.Check all light fixtures to make sure all the bulbs burn.  Use the
largest wattage bulb that you safely can to give off more light.

18. Wash all your windows and make sure window treatments are clean and in
good repair. Keep the window coverings open whenever possible to let in
more light.

19. With a good degreaser, wipe down everything in the kitchen so it feels
clean to the touch. Clean your stove and oven; replace stove eye pans if needed

20. Go through your kitchen cabinets and pantry to make sure they’re neat
and tidy; give any food that you don’t plan to use right away to the local
food pantry.

21.Make sure your sinks are clean at all times and free of dirty dishes and
utensils.

22. Remove all excess items from your counters to give the impression of
lots of work surface.

23. Pleasing aromas add to the appealing atmosphere we’re trying to
establish for your buyers; consider keeping a saucepan of potpourri on the
stove to give off an appealing scent.

24.Clean all light switch places by taking them off and washing with soap
and water; replace if necessary.

25.Make sure the bathrooms are spotless at all times with fresh towels,
decorative soaps, and all fixtures are shiny, scrubbed, and in good repair.

26. Check all faucets and shower heads to make sure they’re spotless and
free of leaks and drips.

27. Repaint interior rooms if needed with neutral colors.

28.Don’t forget your ceilings too; years of living in a home with cooking,
smoking, and other everyday activities can stain ceilings.  Paint ages;
repaint if needed.

29. Don’t have large, space eating house plants sitting around; give them
away or ask a neighbor to store them until you move.

31.The more light you can get into a room the bigger and more spacious the
room will appear. When you leave for a showing, turn on lights in rooms
that are normally darker than you would like and make sure the window
coverings are open to admit outside light.

32. An old decorator trick to bring in more light as well as make rooms
appear larger are mirrors; either hanging on a wall or on a stand.

33. Pack away and store out of season clothes. Get rid of extra hangars.
Straighten up your shoes (consider some inexpensive shoe racks from a
discount store like K-Mart or Wal-Mart).

34. When painting don’t forget the interiors of closets and the closets
doors; make sure all closet and interior doors open and close correctly.

35. Check where ceilings meet wall and clean all cobwebs, this is a
commonly overlooked area when cleaning, along with tops of tall furniture
items such as hutches, entertainment centers, etc.

36. If you have a pet make sure there are no odors. You may not notice
odors since you live with your pet every day, have a neutral third party
give your home a “sniff” test for objectionable odors that may turn buyers off.

37. Also, when buyers come to visit, keep your pet under control, or better
yet, get a friend or neighbor to “pet sit” for you while the buyers are
looking.

38. It’s important that you leave the house for all showings. Buyers feel
less inhibited if you’re not around and will usually take a closer look in
closets and in kitchen cabinets, as well as voice any objections that your
agent can then deal with. If the buyers won’t make comments because you’re
following them around pointing things out then your agent can’t deal with
any potential problems that may hinder making an offer.

39. If you have several vehicles make sure the spot closest to the door
buyers enter through is empty for them.

40. Freshly baked or even store bought cookies & little snacks along with
an appropriate beverage (hot in winter, cold in summer) along with a sign
saying “Please Sit Down and Enjoy a Treat While You’re Here” will make your
home more memorable even if they don’t take anything. Remember little
things can go a long way towards getting your home sold quickly for the
best price.

Call or email me [email protected] for a free, no obligation consultation on your home’s most likely selling price and how to sell it faster for more money.

One of the tough things about making predictions of any sort is that it’s pretty easy to be wrong. I seem to have been wrong once again on my prediction in total 2010 Knoxville, TN area home sales.

If you will recall on November 15, 2010 I predicted a year end total of 9,500 total homes and condos sold in the greater Knoxville area but the final total turned out to be 10,133 for the year. That’s about 600 more than I thought would sell making my guess off by about 6%; not too bad for a guess. It appears the 4th quarter sales of 2010 were far stronger than I thought they would be.

Here’s how 2010 ended up in Knoxville compared to the past 9 years:

You’ll notice that 2010 ended up about 400 homes below 2009. In analyzing the sales data for the past few years I believe the 2009 and some of the 2010 data was artificially inflated by the $8,000 tax credit that expired on April 30th of 2010.

That tax credit may have been driving Knoxville area sales by as much as 20% or more. In addition to driving sales it also seems to have encouraged the sale of more lower priced homes (first time buyers) driving the average sales prices down along with the median prices.

So now we’re in January of 2011 and what’s the Knoxville housing market like so far?

We’re only 2 weeks into the year so very little hard data is available but I’m hearing a lot of anecdotal positive stories from my fellow Realtors about increased traffic at open houses, more inquiries on listings for sale, and lenders fielding questions about interest rate and mortgage loans.

If all that positive activity continues, then 2011 should be a good year for Knoxville sellers and buyers with both increased numbers of sales and higher average prices since the market will be more balanced with the demise of the tax credit.

Interest rates remain at historic lows and inventory of homes in all prices ranges is plentiful.

Head on over to KnoxvilleHomeCenter.com to see all the Knoxville, TN area homes for sale and please email or call me with any homebuying or selling questions.

knoxville tn real estate word cloud

2 of my favorite quotes from the comics; “Good Grief!” is Charlie Brown of Peanuts fame favorite saying. “We has met the enemy and he is us” is from an old comic strip called “Pogo”. Pogo was a cartoon opossum and the originator of that saying.

There has been a lot of noise on the net lately about automated home valuation models along with an increase of websites offering them to both buyers and sellers of real estate.

Unfortunately for those that put a lot of stock in these online appraisals they’re generally overly broad and very, very often not valid for today’s prices in a given neighborhood.

I had a buyer recently I had been sending e mails of listings that nominally met his buying criteria. One day he called and wanted to go look at 3 houses he said he was interested in.

We went and one turned out to be his proverbial dream house. Went back to the office to write an offer and he pulled out not one, not two, but three online valuations of his 3 favorite houses including the one we were fixing to write an offer on.

Good Grief!!

I’ve never seen such a disjointed batch of alleged comparable sales in my real estate career. Just because a house has the same number of square feet as another or happens in be in close proximity, that has nothing to do with the value of either house.

Some of them had used a condo complex just down the street to compare to a single family home in a neighborhood, others were wildly out of the ballpark both ways on suggested values.

After we sat down and went on the MLS (Multiple Listing Service) to find some valid comparables along with some knowledge I had of those sales, we wrote a successful offer.

The huge flaw with most of these services is that they just pull sales from databases and the programmers have no clue as to where they’ve told it to look.

They also don’t (and can’t) factor in nuances we would likely be aware of like sellers paying closing costs for a buyer, redecorating-done or not, property size, and a host of other very important variables.

There’s way too many of these so called “instant appraisal” services running around out there leading both buyers and sellers off in the wrong direction about the value of houses for sale.

We need to go a much better job of educating the public and our buyers and sellers about the flaws and limitations of these online valuation guys or we’ll be dealing with stuff like this on every sale.

Somehow I don’t have high hopes of that happening.

“We has met the enemy and he is us.”

Hindsight is always 20/20 and in November of 2011 it will be very simple to just review the past year and see what actually did happen. But since it’s now November of 2010 we will have to look to the past years and the current economic data to make a future prediction. It’s always interesting to me to revisit my past predictions and see how I did.

Here’s my prediction for the 2010 Knoxville area real estate market. For the first three quarters of the year Knoxville area Realtors have sold and closed 7,862 residential units, that’s single family homes and condos combined. For the entire year of 2009 that total was 10,511. I don’t think there is going to be another 2,649 sales before 2010 ends so using the best available data it looks as if we will be down in 2010 compared to 2009. I predict total Knoxville area homes sold in 2010 will end up around 9,000 to maybe 9,500; down a little from 2009 levels.

NOTE: The chart below only contains sales data for the first three quarters of 2010.

9,500 sales in 2010 will put us roughly around the 2001 levels. I’m basing this prediction on past sales and the current state of the US and local economy.

Sales in 2010 were somewhat artificially inflated by the $8,000 dollar tax credit that has now expired for most buyers but there are still exceptions, i.e. military personnel serving outside the US. That credit served to prop up the market a bit this year and will not be available in 2011. I predict, if we’re very lucky, home sales in 2011 will hopefully equal 2009-2010 numbers and we will sell around 9-10,000 homes in the greater Knoxville area.

I also believe the bulk of sales in 2011 will be in the lower price ranges as they are now.

Year to date there have been at total of 16 closed sales of houses priced over one million dollars; that’s 1.6 sales a month. Currently there are 83 houses for sale at that price level. To get the absorption rate (time to sell) for that price you divide the monthly sales into the current inventory and you get 51.8 months, or over 4 years to sell just those 83 houses assuming no new listings come along. THAT is a sluggish market.

Contrast that to the “hot” price range now of $120,000 to $139,999 where you find 347 closed sales of in 2010 or 34.7 per month. There are currently 242 active listings in that price range so that would make their absorption rate 9.86 months. Lower priced homes are selling but the time to sell is still high signaling a buyer’s market for those homes as well.

Here are some things I base my prediction on:

• JOBS: Jobs continue to be an economic problem, especially for housing. People with no jobs don’t usually buy houses and unfortunately, people with no jobs also get foreclosed on as well. The unemployment rate is officially 9.6% now and is essentially unchanged since May of this year. I believe the true unemployment rate is more in the 15-20% range because a lot of people have exhausted their unemployment insurance and are no long counted in the statistics. Also people like Realtors and other self employed persons are usually not eligible for unemployment benefits and are never counted whether working or now. Jobs will continue to be a drag on the housing market in 2011.
• Economic uncertainty will continue: “Says Lynn Franco, Director of The Conference Board Consumer Research Center: “Consumer confidence, while slightly improved from September levels, is still hovering at historically low levels. Consumers’ assessment of the current state of the economy is relatively unchanged, primarily because labor market conditions have yet to significantly improve. And, despite the uptick in Expectations, consumers continue to be quite concerned about the short-term outlook. Both present and future indicators point toward more of the same in the coming months.” I can’t say it better than that.
• Interest Rates: While interest rates are as low as I’ve ever seen them in my 30+ years in real estate, jobs, available mortgage money, and consumer confidence will continue to keep buyers away in 2011. Anyone qualified and sitting on the fence waiting for lower prices, lower rates, whatever, should probably go ahead and buy now. Mortgage rates cannot go any lower and most sellers are taking a beating now when they sell. The time for qualified buyers with a stable job  to buy a home has never been better than it is right now.